A division bench of Justices P B Varale and S M Modak noted that the FIR lodged in April 2021 by the Palghar police was an abuse of the process of law.
The FIR, accusing the promoters and directors of the company of siphoning off funds and committing accounting irregularities, was lodged following the Palghar magistrate's April 7, 2021 direction based on a complaint by Ashutosh Kamble, a shareholder of IHFL.
The high court on Wednesday quashed the magistrate court's order directing the registration of the FIR, which was initially filed in Wada under the Palghar district and later transferred to Maharashtra's Police's Crime Investigation Department (CID).
In his complaint to the magistrate, Kamble had claimed that he suffered a devaluation of his shares due to alleged misdealing by IHFL between 2014 and 2020.
Senior advocates Mukul Rohatgi and Amit Desai, representing IHFL, had argued that the FIR lodged by Kamble was "absolutely malafide and part of similar attempts made earlier against the petitioners by certain persons seeking to initiate criminal proceedings on the basis of false and frivolous allegations, so as to extract money from the petitioners".
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